BLS area wage surveys
will cover more areas
Earnings data for blue- and white-collar occupations
will be published for 90 areas instead of the current 70,
but about two-thirds of the areas will be surveyed
on a 2-year rather than 1-year cycle
LAURA SCOFEA
The Bureau of Labor Statistics will restructure the probability sample of labor markets for its area wage survey program
to reflect changes in the number and geographic boundaries
of the Nation's metropolitan statistical areas. The new area
sample will be phased in over a 4-year period beginning in
January 1987, and will contain 90 areas when fully implemented . The 32 largest areas in terms of nonfarm employment will be surveyed annually, and two groups of 29 areas
will be surveyed in alternate years.
Currently, 70 areas are surveyed annually . Of these areas,
56 will remain in the program ; geographic boundaries, however, will change for 34 of them .
This article gives a brief description of the Bureau's area
wage survey program and the changes to be made in the
probability sample of areas surveyed . The article covers
area wage survey program objectives and program evolution
from initial 1947-48 studies of pay for office clerical occupations in 11 large cities . It also describes the metropolitan
area concept used in the program, reasons for changes in the
area sample, the method for selecting the new sample, and
the differences between the old and new area samples.
Program background
The Bureau's area wage survey program is designed to
shed light on the level and structure of occupational pay
Laura Scofea is an economist in the Division of Occupational Pay and
Employee Benefit Levels, Bureau of Labor Statistics .
rates within a local labor market by studying occupations
common to many industries . t The areas surveyed are a representative cross-section of the wide variety of local labor
markets found throughout the United States . The surveys,
relating to specific payroll periods, focus on pay relationships among occupations, industries, and areas of the country. Successive survey findings are also useful in reviewing
pay changes over time .
Using a standard set of job descriptions, the Bureau designs surveys which cover narrowly defined occupations
selected from four categories-office clerical (such as secretaries, typists, and accounting clerks); professional and
technical (for example, computer programmers and electronics technicians) ; maintenance, toolroom, and powerplant (maintenance electricians and stationary engineers) ;
and material movement and custodial (order fillers and
guards) . Estimates of average straight-time hourly or
weekly earnings and distributions of workers by their earnings are developed for each of approximately 50 occupations studied. (Fifteen of the occupations-for example,
word processors, computer systems analysts, and guardsare divided into two work levels or more .)
In addition, every third year the surveys yield information
on the prevalence of provisions for cost-of-living adjustments in pay rates; minimum entrance salaries for inexperienced typists and other inexperienced clerical workers; pay
differentials for work on late shifts ; work schedules; extent
of collective bargaining agreement coverage ; holiday, vaca19
MONTHLY LABOR REVIEW
June 1986
e
acs Area Wage Surveys Will Cover More Areas
tion, and other paid leave provisions ; and the incidence of
health, insurance, retirement, severance pay, and supplemental unemployment benefits . Data typically are developed separately for production and office workers; information on shift pay differentials, however, is restricted to
production workers in manufacturing.
Findings for each area wage survey are published in a
separate BLS bulletin .2 To aid in interarea pay comparisons,
average area pay levels in four employment groups-office
clerical, electronic data processing, skilled maintenance,
and unskilled plant jobs-are related to pay levels for all
metropolitan areas combined, in index form, that is, all
metropolitan area pay levels = 100. Results are published in
an annual summary release.' Results of the individual surveys, after appropriate weighting to account for areas not
surveyed, are also combined to develop pay levels for the
narrowly defined occupations in all metropolitan areas combined; separate data are presented for major industry divisions and for four broad geographic regions .4 Also, special
articles appear in the Monthly Labor Review, with in-depth
analyses of specific survey findings .'
The area wage survey program has grown considerably
since it started in fiscal year 1948 as part of a restructuring
of the Bureau's occupational wage survey activities . That
year's surveys provided information on salaries in office
clerical occupations in 11 large cities . In 1950, the geographic scope of the surveys expanded from cities to the
larger metropolitan areas as defined by the U.S . Bureau of
the Budget (now the Office of Management and Budget) . A
year later, professional and technical, maintenance, and
custodial and material movement occupations were added.b
These developments roughly coincided with the outbreak
of the Korean conflict . Resources for area wage surveys
were expanded as a result of this emergency in order to
provide data for administering wage stabilization policies .
During the 1950's, between 11 and 40 areas of various sizes
were studied in a given year, with the number depending on
resources available for the program.
Current program emerges
In fiscal year 1960, the current program emerged when
there was a conversion from studies in judgmentally selected areas to a statistically selected sample of areas chosen
to represent all metropolitan areas in the contiguous 48
States . Consequently, findings of individual areas could be
combined, after appropriate weighting, to yield national and
regional estimates . The sample selected for fiscal 1960 contained 60 areas, representative of the 188 areas then in the
scope of the program. A year later, the sample included 80
areas, and gradually grew to 85 areas, representing the 229
areas in scope for 1969 .7
The major thrust of the 1960's expansion was a need for
nationwide estimates of office clerical pay in private industry for use in evaluating Federal white-collar salaries . Data
obtained for plant jobs in the individual areas surveyed also
20
were used by the Department of Defense and other agencies
in setting pay rates for their blue-collar "wage board" employees .
The most recent change in the program occurred after the
Office of Management and Budget made major changes in
its list of metropolitan areas, based on results of the 1970
Census of Population . The Bureau selected a new 70-area
sample and introduced it in July 1974 .8 These 70 areas will
continue as the area sample through December 1986, representing the 262 metropolitan areas (excluding those in
Alaska, Hawaii, and Puerto Rico) recognized and defined
by the Office of Management and Budget as of February
1974 .
Changing metropolitan area definitions
With few exceptions, area wage surveys have been conducted since 1950 in metropolitan areas as defined by the
Office of Management and Budget or its predecessor, the
Bureau of the Budget .9 Standard metropolitan area definitions were first developed by the Bureau of the Budget
shortly before the 1950 census, primarily to provide a common set of geographic definitions for Federal statistical
agencies .
The metropolitan area concept recognizes that large population concentrations often extend beyond the borders of a
single city . Under this concept, a metropolitan area consists
of one county or more, containing the area's main population center, and may also include adjacent counties that have
close economic and social ties to the central counties . (In
New England, metropolitan areas are composed of cities
and towns rather than counties .) Areas are designated and
defined by the Office of Management and Budget based on
a set of criteria developed by the interagency Federal Committee on Standard Metropolitan Statistical Areas.
The number of recognized metropolitan areas has grown
substantially, from 172 in 1950 to 288 as of January 1,
1980 . In part, this growth stems from changes in the criteria
for designating metropolitan areas that have been made at
the time of each population census since 1950 .1° Although
these changes have not significantly altered the basic
metropolitan area concept, they have resulted in the recognition of new areas and in changes in the boundaries of existing areas. However, most of the growth in the number of
metropolitan areas is the result of population growth and
increased urbanization in the United States .
The most recent revision in standards for designating and
defining metropolitan areas was published in the Federal
Register on January 3, 1980 .11 The new standards introduced revised terminology . The existing term, "Standard
Metropolitan Statistical Area" (SMSA), was replaced by
"Metropolitan Statistical Area" (MSA) and "Primary Metropolitan Statistical Area" (PMSA) . Areas such as San Antonio, Tx (Bexar, Comal, and Guadalupe Counties), which
are not closely related to other metropolitan areas, and are
typically surrounded by nonmetropolitan counties, are
called MSA's. PMSA's are components of larger "Consolidated Metropolitan Statistical Areas" (CMSA's) . For example, Seattle (King and Snohomish Counties) and Tacoma
(Pierce County) are PMSA's that jointly form the SeattleTacoma, Washington CMSA . CMSA's, not studied in the area
wage survey program, have replaced the former "Standard
Consolidated Statistical Areas" (SCSA's) .
Restructuring the program
Using the new standards and data from the 1980 census,
the Office of Management and Budget defined a total of 326
MSA's and PMSA's in the contiguous 48 States, as of October 31, 1984 .12 As a result, BLS' area sample for its area
wage surveys became outdated .
A principal consideration in planning for a revised sample
of areas was maximizing the usefulness of survey results,
given the level of resources available for area wage surveys.
The Bureau and its business and labor advisory groups explored three alternatives : (1) a 70-area sample of the 326
metropolitan areas within the scope of the program, each
area to be surveyed annually ; (2) a 70-area sample of the
155 areas with populations of 250,000 or more, surveyed
annually ; and (3) a 90-area sample of all 326 areas, the 32
largest areas of the United States to be surveyed annually
and two groups of 29 smaller areas each to be surveyed in
alternate years . Each of these options, requiring about the
same level of resources annually, was designed to represent
areas differing in employment size, industrial composition,
and geographic location . Provision for probability sampling
permitted the development of national and regional estimates each year as in the past .
The third option was chosen because it provides information for the largest number of areas with the resources available . Also, the burden on individual respondents is reduced
by rotating between the two groups of 29 areas.
To select the sample of 90 areas, all 326 MSA's and
PMSA's as of October 1984 were grouped into 90 statistical
"cells ." One area in each of the cells was then selected to
represent all areas in the cell . The 32 largest areas in terms
of nonagricultural employment were the sole occupants of
their cells and thus were automatically included in the
sample .
The 294 remaining areas were grouped into 58 (90 minus
32) cells according to the following criteria, which are listed
in descending order of importance :
" Broad geographic region-Northeast, South, Midwest,
and West ;
" Similarity of manufacturing industries (with emphasis on
similarity of average earnings of production workers) ;
" Approximate equality of total nonagricultural employment ; and
" Boundaries of BLS regional offices.
One area was randomly selected from each cell . An area's
chance of selection was proportionate to its share of the total
nonagricultural employment in the cell . For example, an
area with a quarter of the employment in its cell had a 1-in-4
chance of selection. A statistical technique known as Keyfitzing was used to obtain as much overlap as possible between areas in the current and new samples . 13
Exhibit 1 shows the result of the 90-area selection. Fiftysix of the areas in the new sample have been surveyed since
1974 ; 34 have not. Geographic boundaries stayed the same
in 22 of the 56 retained areas; in the remaining 34, new
boundaries resulted in nonagricultural employment increases or decreases of fewer than 10 percent in 23 areas;
between 10 and 20 percent in 8 areas; and decreases of more
than 25 percent in Dallas, Huntsville, and San Francisco.
(Decreases in Dallas and San Francisco reflect splits of the
former Dallas-Fort Worth and San Francisco-Oakland
areas. Two counties formerly in the Huntsville, AL, metropolitan area are now nonmetropolitan counties .)
The new sample, reflecting population shifts in the
United States, contains a slightly higher proportion of
Southern and Western areas than does the current sample .
Among the additions to the area wage survey program are
Phoenix, Az, Riverside-San Bernardino, CA, and TampaSt . Petersburg-Clearwater, FL, which now rank among the
25 most populated areas.
Implementing the new sample
The 90-area sample will be phased into the area wage
survey program over a 4-year period, beginning in January
1987 . Each year, surveys will be conducted in 61 areasthe 32 largest areas and half of the smaller areas .
In the largest areas, wage and benefit data will be obtained from surveyed establishments through personal visits
by BLS field representatives once every 3 years . In the intervening years, collection (primarily by mail or telephone)
will be limited to wage information .
The smaller areas will be divided into two groups of 29
areas. The groups will be surveyed in alternating years.
Thus, an individual area will be studied twice in a 4-year
cycle: a survey of wages and benefits will be conducted by
personal visit one year ; and a survey of wages only will be
conducted by mail and telephone 2 years later.
As new areas enter the program, those no longer in the
sample will be dropped. For areas retained in the program,
changes in the geographic boundaries of metropolitan areas
will be reflected in the year an area is surveyed by personal
visit.
Most of the areas to be dropped from the area wage
survey program will still be surveyed by BLS, but not as part
of its own program. Each year the Bureau conducts about
100 locality wage surveys for the Employment Standards
Administration of the U.S . Department of Labor. 14 Results
from these surveys are used in administering the Service
Contract Act, which sets minimum wages by occupation for
employees of firms providing services to the Federal
0
Government .
21
MONTHLY LABOR REVIEW
June 1986 "
BLs Area Wage Surveys Will Cover More Areas
for Bl_s area wage surveys
South
Atlanta, GAI
Baltimore, MD'
Corpus Christi, TX
Dallas, TX1,2
Gainesville, FL
Houston, TX'
Huntsville, AL
Jackson, Ms
Louisville, KY-IN
Memphis, TN-AR-Ms
Miami-Hialeah, FLI
New Orleans, LAI
Richmond-Petersburg, VA
San Antonio, TX
Washington, DC-MD-VAI
Midwest
West
Chicago, IL'
Cincinnati, OH-KY-INI
Cleveland, OHI
Columbus, OH
Davenport-Rock Island-
Moline, IA-IL
Detroit, mil
Gary-Hammond, IN
Indianapolis, IN
Kansas City, MO-KS'
Milwaukee, wit
Minneapolis-St . Paul, MN-wil
Omaha, NE-IA
St . Louis, Mo-ILI
South Bend-Mishawaka, IN
Toledo, off
Areas new to program
Augusta, GA-SC
Austin, Tx
Bradenton, FL
Charleston, sc
Charlotte-Gastonia-Rock Hill,
NC-SC
Florence, sc
Little Rock-North Little Rock,
AR
Longview-Marshall, Tx
Mobile, AL
Nashville, TN
Orlando, FL
San Angelo, Tx
Shreveport, LA
Tampa-St . PetersburgClearwater, FLI
Wilmington, DE-NJ-MD
Appleton-OshkoshNeenah, wI
Champaign-UrbanaRantoul, IL
Decatur, iL
Elkhart-Goshen, IN
Joliet, IL
Kokomo, IN
St . Cloud, MN
Areas dropped from program
Chattanooga, TN-GA
Daytona Beach, FL
Greensboro-Winston-SalemHigh Point, NC
Greenville-Spartanburg, SC
Jacksonville, FL
Norfolk-Virginia BeachPortsmouth, VA-NC
Oklahoma City, OK
er areas will be surveyed twice in a
ncluded Fort Worth, Tx .
ormerly titled Northeast Pennsylvania .
Dayton, OH
Green Bay, wI
Saginaw, MJ
Wichita, KS
4 Formerly included in New York, NY-NJ,
saic, NJ .
5 Formerly included in San Francisco-Oakland, CA .
6 Formerly included in Providence-Warwick-Pawtucket, RI-MA.
FOOTNOTES
I The surveys include establishments in six broad industry divisions:
manufacturing; transportation, communication, and other public utilities;
wholesale trade; retail trade; finance, insurance, and real estate ; and selected services . Major exclusions from the survey are construction, extractive industries, and government . Establishments employing 50 workers or
more are included except in the 13 largest areas where the minimum
establishment size is 100 workers in manufacturing; transportation, communication, and other public utilities; and retail trade.
2 See, for example, Area Wage Survey : New York, New York-New
Jersey, Metropolitan Area, May 1985, Bulletin 3030-32 (Bureau of Labor
Statistics, September 1985). Summaries of each of the 70 surveyed areas
are also reported in a single volume . See Area Wage Surveys: Selected
Metropolitan Areas, 1984, Bulletin 3025-72 (Bureau of Labor Statistics,
June 1985) .
3See Wage Differences Among Metropolitan Areas, 1984, Summary
85-7 (Bureau of Labor Statistics, June 1985).
4 See Occupational Earnings in All Metropolitan Areas, July 1984,
Summary 85-4 (Bureau of Labor Statistics, May 1985).
5 See, for example, John E. Buckley, "Wage differences among workers
in the same job and establishment," Monthly Labor Review, March 1985,
pp . 11-16. An annual report compares wage levels in the areas surveyed .
A more detailed description of the area wage survey program, including a
discussion of uses and limitations of survey findings, is in BLS Handbook
ofMethods, Vol. 1, Bulletin 2134-1 (Bureau of Labor Statistics, December
1982), pp . 67-73.
6 Test surveys including blue-collar jobs were conducted successfully in
1949 in six cities .
I The program also included surveys in two nonmetropolitan areasBoise, Idaho, and Burlington, Vermont-located in States without
metropolitan areas. In addition, several surveys not part of the regular area
program were conducted under contract .
8 See Virginia L. Ward, "Area sample changes in the area wage survey
program," Monthly Labor Review, May 1975, pp . 49-50.
9 The Chicago survey was limited to Cook County and the New York
survey to the five boroughs until 1963 .
1° At times, changes have been made between census years.
11 They are also contained in the Statistical Reporter, December 1979,
pp . 33-45 . For background information, see Federal Committee on Standard Metropolitan Statistical Areas, "Documents Relating to the Metropolitan Statistical Area Classification for the 1980's," Statistical Reporter,
August 1980, pp . 335-84 .
12 MSA definitions generally do not change except after the decennial
census . Each year, however, a few new mtSA's may be announced, usually
because of population growth .
13 See Nathan Keyfitz, "Sampling with Probabilities Proportional to
Size : Adjusting for Changes in the Probabilities," Journal of the American
Statistical Association, No . 46, 1951, pp . 105-09 .
14 See, for example, Area Wage Survey : Fort Wayne, iN, June 1985
(Bureau of Labor Statistics, August 1985).